Seasonal hiring drops Pittsburgh area jobless rate to 5.2 percent
The Pittsburgh region's job market improved in October as seasonal hiring for the holidays helped drive down unemployment.
Employers in the seven-county metro region added 8,900 nonfarm jobs in October, with more than half those coming from the retail and leisure industries, the Pennsylvania Department of Labor & Industry said Thursday. The unemployment rate ticked down a tenth of a percentage point to 5.2 percent.
Despite softness in some areas, Pittsburgh's economy appears to be on solid ground, and the expansion in retail and leisure suggests consumers are optimistic heading into the holidays, said Kurt Rankin, an economist at PNC Financial Services Group.
“Those two industries suggest that Pittsburghers are not letting up in terms of spending,” he said.
Confidence among job seekers also appears to be on the rise. The seasonally adjusted labor force, which counts anyone who is working or looking for work, expanded by 3,000 people.
Hiring at colleges, universities and local public schools contributed to the job gains in October and more than offset losses in construction and manufacturing. Employment was flat in mining and logging, which includes the natural gas industry. That sector has been struggling because of low oil and gas prices.
While service-sector job growth is positive, the local economy would be stronger if there were more balance coming from manufacturing, said Frank Gamrat, an economist at the Allegheny Institute for Public Policy. Those tend to be higher-paying jobs, and manufacturers shed 300 workers in October and 1,300 over the past year.
“You don't want to build your economy on service jobs,” Gamrat said. “You want them in the more high-paying goods-producing jobs.”
Another area of concern was the region's financial firms, which shed 1,700 jobs from payrolls in October — the biggest monthly losses of any sector.
Uncertainty over rising interest rates was the most likely explanation for that pullback, Rankin said.
Rising rates are good for banks because they can make more money on lending. The Federal Reserve Bank has held interest rates near zero since 2008, and many analysts expected the first rate increase to come in September. That did not happen, which caused bank stock prices to fall and could have persuaded financial firms to hold back on hiring.
Employment at financial firms could pick up again soon if the Fed raises interest rates this month, as many analysts expect, Rankin said.
At 5.2 percent, Pittsburgh's unemployment rate is still higher than the statewide rate of 5.1 percent in October and the national rate of 5 percent. The national jobs report for November is scheduled to be released on Friday.
Chris Fleisher is a staff writer for Trib Total Media. He can be reached at 412-320-7854 or email@example.com.